Verizon and Travelers — What you need to know on Thursday

After briefly cracking 23,000 for the first time on Tuesday the Dow blew past this milestone on Wednesday, rallying more than 150 points to close at a new record high of 23,157. The S&P 500 also hit a record on Wednesday.

The bluechip index was led by gains from IBM (IBM), a struggling stalwart of the index that rose almost 9% after earnings and forecasting a year-on-year revenue gain for its current quarter that would break a more than five-year streak of sales declines.

On the economic calendar, the weekly report on initial jobless claims and the latest manufacturing index from the Philadelphia Federal Reserve will be the highlights.

Investors will also keep an eye on Washington D.C. for any updates on President Donald Trump’s proposed tax reform plan.

Treasury secretary Steven Mnuchin, who along with his fellow Goldman Sachs (GS) alum Gary Cohn is leading the administration’s charge on taxes, said in an interview published Wednesday that the stock market would likely “see a reversal of a significant amount” of its post-election gains if nothing got done on taxes. Action in the stock market and recent investor surveys, however, suggest otherwise.

Signs of wage growth are everywhere

The unemployment rate is at a 16-year low of 4.2% and yet economists are still looking for an acceleration in wages.

In September, average hourly earnings rose 2.9% over the prior year, the most since December 2016 and near its best level since this measure was coming down after the financial crisis.

Yet without this trend accelerating, economists have looked to more anecdotal evidence in commentary around the labor market to find signs that though higher wages may not be showing up in the data yet, they are certainly coming.

On Wednesday, the Federal Reserve’s latest Beige Book indicated an increasing willingness among employers to compete for labor in a market that has become scare. The Beige Book is a collection of economic anecdotes gathered by Fed researchers in each of its 12 districts.

A now hiring sign is seen outside Lexus of Serramonte in Colma, California, U.S., October 3, 2017. REUTERS/Stephen Lam

In the Atlanta Fed region, which includes Florida and so was adversely impacted by Hurricane Irma, “Commercial and residential construction industry contacts further indicated that labor shortages were restraining growth,” the report said.

The Beige Book added that in this region, “Businesses continued to engage in partnerships with the educational and workforce development community to fill specific industry or individual firms’ skill gaps. Broadly, businesses continued to use non-wage mechanisms to attract and retain workers.”

And so whether it is more flexible hours, the ability to work from home, or better in-office perks businesses are still trying almost anything they can to avoid raising pay for workers. As long as it will last, at least.

In the Dallas Fed region, which is still dealing with the fallout from Hurricane Harvey, “Reports of labor shortages persisted, spanning most industries. Some manufacturers said the difficulty finding workers was impeding their growth, and some services firms said it was driving up overtime costs. More than a quarter of firms expect that the impact of Hurricane Harvey will make finding and hiring workers more difficult over the next six months.”

Reports from the Minneapolis Fed’s region showed that, “Wages rose moderately since the last report, with some mixed signals, but overall showing signs of strengthening. A staffing contact said one client has raised starting wages three times since June.”

Examples like these exist throughout the report, and the takeaway is clear — it is hard to find workers in America right now.

Businesses, perhaps still not ready to adjust from a post-crisis stance of having leverage over most all potential employees, are still putting off what at this point seems like an inevitable ramp in wages. The economic textbook would say this likely foreshadows an uptick in inflation. But given the “mystery” low inflation has been to central bankers this year, we’ll see if the textbook is right.

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Myles Udland is a writer at Yahoo Finance. Follow him on Twitter @MylesUdland